[rustynutz]

Breaking news...

Apparently Ford Australia is about to close up shop here in Australia.
If this is true this will be sad sad news for both the workforce and motoring in general. 

[Phil №❶]

No surprise at all really, govts, both state and federal have been propping up this industry with tax breaks etc and hoping the problem will just go away.

Stupid sods can't realise that this recipe doesn't work. Couple that with completely inept senior management, Ford & GM alike, (both broke actually) and this is what you get.

Australians want a standard of living we can't afford. Wages are too high and inevitably, people will earn nothing.

Hyundai can't keep up with demand, they run a 3 shift operation in their plants. Why, automation, low wages and a product made to fit the times.

[rustynutz]

http://www.news.com.au/business/ford-australia-to-shut-broadmeadows-car-factory-geelong-engine-plant/story-e6frfm1i-1226648895882

[Doggie 1]

2016 closure apparently.

[rustynutz]

Yep, October 2016....

[Doggie 1]

I don't understand why they haven't produced cars that people want.
I am a Ford man from way back, but they just don't offer what I, or many others want.
The disel Territory has been a great seller for Ford because people want them and buy them.
Why they didn't introduce that engine in the Falcon sedan range is beyond me.
I test drove the Focus diesel prior to buying my latest i30, but you can't buy a manual diesel Focus in Australia.
Go figure. 

[Surferdude]

I know I'm a cynic, but watch the quality of the finished product fall away sharply from today.

[Doggie 1]

I know I'm a cynic, but watch the quality of the finished product fall away sharply from today.

Bugger.
I quite fancied putting in an order on the last day of ordering in 2016 for a fully optioned sedan. 

[Surferdude]

I know I'm a cynic, but watch the quality of the finished product fall away sharply from today.

Bugger.
I quite fancied putting in an order on the last day of ordering in 2016 for a fully optioned sedan. 

Should be fine as long as you don't drive it.

[Doggie 1]

I know I'm a cynic, but watch the quality of the finished product fall away sharply from today.

Bugger.
I quite fancied putting in an order on the last day of ordering in 2016 for a fully optioned sedan. 

Should be fine as long as you don't drive it.

It would be nice to have one of the last few off the production line as a keeper.
I have one of the last ten XE Cleveland V8s (5.8) off the line (Nov 1982) which could keep it company.

[Just Rick]

I know I'm a cynic, but watch the quality of the finished product fall away sharply from today.

for the money their asking and we looked while we were looking for our new cars,like dave we looked t the festvia and the focus,IMHO the build quality was not that much better than what we got.

I am with Phil too,govt should have dumped the car industry years ago,just propping up a lost cause,Phil also hit the nail on the head,we and I mean all of us,want the high wages,to keep up with rising costs,problem is we as a nation in all honesty want to do bugger all for the highest of wages,the transport industry and some of the industries we supply are all prefect examples,trying to get someone to work for the money they actually get paid,you have a better chance at splitting your skull open by smacking it against a brick wall,you wouldn't believe the amount of heated discussions I get into over PPL's so called work ethics

[Phil №❶]

So what's different in S Korea and Czechoslovakia. 24 hr car plant operations. Are we so stupid, that we're going to stand by and let manufacturing in this country slip through our fingers.

Here's my recipe.

Find a decent designer of cars, relevant to current and future needs.

Acquire all plants in Australia for no cost to the govt as repayment for years of assistance payments. Option to sell to private enterprise in 10 years.

Offer jobs at 50% pay, income tax free, pay scale bonus, based on quality of production.

% share of profits to each worker, based on length of service.

Senior management renumeration fixed to base backbencher salary (Taxable).

Radical, yes, but what we have now is a recipe for disaster.

[Just Rick]

Can't argue with that Phil,but I would also throw in their super and 24/7 work cover,but can't ever see it happening

[beerman]

Ford have been kicking the can down the road on this decision for years.

I think they have taken some strange decisions, for example they design the LPI falcon which by all accounts kicks butt and takes advantage of LPG which is currently 0.60 cpl making it as economical to drive as anything out there, but have you heard about it? They prefer to promote their ecoboost engine, which by all accounts is good too, but not as economical.

The fact that it took a million years to put a diesel in the Territory is another example of their head in the sand approach, it might have been a good idea to design the LPI for the Terry too, imagine that a big family wagon that takes fuel that is 0.60cpl and you don't get oily filling it up.

They continued to fully design a totally new car, not taking advantages of the economy of scales elsewhere. The Falcon could have been a disguised Taurus tweaked for Australia (as the Camry and Commodore were originally). They decided against building the Focus here which would have probably saved the factory and given them a car size that people wanted, but the high dollar deprived them of the export market they needed to make the project a winner.

But the big killer was the build quality. They had a big winner with the original Territory, but the build quality and the bad design of the ball joints, caused a huge number of problems. Ford management were too stupid to realise that the internet effectively nullified their 'haven't seen one do this before' approach to customer complaints (Especially when the customers found the problem at 3 years and one day having done only 25000k). Eventually they were forced into a back flip, but it was too late for those that had paid to have the problem fixed, they just vowed never to buy Ford again and moved to Hyundai.

At the end of the day, there is massive overcapacity in the world auto industry, like Australia, other countries (especially in Europe), are making more cars than people want with its high dollar (making them cheaper) and free trade agenda, Australia has become a convenient dumping ground for some of these cars diluting the market for the local boys.

It is indeed a sad day, and one is left to ponder what jobs my kids will have in a country that can't make anything and can't dig the resources we have out of the ground cheaply enough to sell at a profit. Perhaps with our speedy internet we can become the home of spam and cyber crime?

[Dazzler]

Well said beerman! Some nice turns of phrase there...

[Lester]

Blame the government, they allow the imports in.   I recommend only Hyundai's be allowed into Australia.

Do ye hear that..Joooooooooooolia ! 

[The Gonz]

 

[Lester]

I reckon Holden will go from Australia in 5 years, build them all in Korea.

[Doggie 1]

Yes, I think they are on shaky ground.
Wouldn't it be nice to have a true Australian designed and built car once again?
(Like the P76).

[Aussie Keith]

Putting the problem management hat on for a moment what are some of the root causes that have led to this point? High wages perhaps? The unions have done much to contribute to conditions now enjoyed by workers. The flip side, it makes our labour expensive especially compared to places now favoured by auto manufacturers for the assembly of their cars. Thailand and India for example.

Government regulation? The cost of compliance to numerous government regulations such as workplace health and safety (to name one) is astronomical. Compliance is costly and further decreases the ability to compete compared to other markets which are more flexible in these respects.

Dilution of the market by introducing new model segments. The clever marketers who gave use really small cars, small cars, medium cars, large cars, etc, have shot themselves in the foot. This back to a time where model choices were few and the most significant difference was the colour. Now there are so many choices its really difficult to achieve the scales of economy to make a decent profit compared to large markets which can support/absorb such fragmentation. 

The minimal variants of local models make it hard to achieve sustainable economies of scale by accessing global  markets. Holden's foray into the US market in the guise of Chevrolets and Pontiacs is a demonstration of this. Four door rwd vehicles? Check. Sadly that leaves only the performance market as most US volume sellers have been fwd for a long time. Unfortunately Holden are competing in a bigger pond and US consumers have plenty of choice at keen prices which is why that experiment failed. The GX8 was sold over there at a significant discount to what an equivalent cars was available for here for example. GM/Holden are having another crack at the US with rebadged Commodores, I hope it goes well for them this time.

http://www.themotorreport.com.au/55972/holden-commodore-returns-to-us-2014-chevrolet-ss-unveiled

Australia is a small, tough price sensitive market which has seen the withdrawal of the previous manufacturers unable to compete. Its more profitable for them to import as they now do. And frankly it will be better for consumers if Holden and Ford cease manufacturing and import as well. Lets not forget they are both US companies at the end of the day. Parochial calls to buy "Aussie cars" is a marketing ploy. All the manufacturers who sell their cars here employ locals at the end of the day, same as Ford and Holden.

A smart company would target a global market, segment and focus on their market's requirements, design their vehicles to suit using the best engineers and designers available to them, manufacture where it makes sense to do so most economically and sell their well designed and supported product at competitive prices. Hard to see how such a recipe could fail to be honest. It's what Hyundai do for example. Holden and Ford (AU) are yet to fully implemented this recipe.

[Aussie Keith]

Yes, I think they are on shaky ground.
Wouldn't it be nice to have a true Australian designed and built car once again?
(Like the P76).

Not unless it was good enough and cheap enough to seriously consider. Can't see that happening any time soon.

The Falcon evolved from an American design, the Commodore was a European design. I suspect the Territory may be the only real locally designed vehicle.

[rustynutz]

I thought the VE Commodore was Aussie designed? 

[2i30s]

and surprise surprise,the geelong and broadmeadows sites are on crown land with a 100 year lease that expires in 2016. 

[beerman]

If the Aussie dollar falls back down to .70, the Aussie made cars become more competitively priced against the imports. Some of the imports will retreat from the Aussie market because they will be too expensive and economies of scale will be restored, as with other local manufactured goods.

We are importing half baked bread products from Ireland......We can't even bake cakes in supermarkets any more.

If we shop and bank online, send our call centres overseas, and put our baked goods in the oven for 5 minutes before selling them, where are the jobs for the kids in 20 years?

[Dazzler]

If the Aussie dollar falls back down to .70, ?

But is that likely?

Where are you Dave? (db08)

[Phil №❶]

70 cents, 

[Aussie Keith]

The dollar remains fairly strong in the global economy. On the one hand its great for imports but not so good for exports. If it does fall away to nothing again, we will feel the pain in many ways, given how much stuff is now imported instead of being produced here. I still wouldn't buy a big car from Ford or Holden even if they were practically giving them away since I don't need a car that big nor the cost of operating one.

Unlike previously (OK a fair while back) there's now plenty of choice, people choose with their wallets and according to their requirements. Fewer people these days need a car as big as a Commodore or Falcon and if they do they usually buy a 4WD or a people mover - hence the Territory which was a clever move on Ford's part. We had a Kia Carnival for years for example, my brothers cart their tribes around in Toyota and Mitsubishi 4WD's. Years ago it would have been a Falcon or Holden station wagon since that would have been the only choice available.

The VE is indeed a local design, thanks for pointing that out. Its possibly a little unfair not to note the local engineering effort from both Ford and Holden in their local products which has been extensive over the years. But the fact remains they are not selling like they used to owing to consumers finding other vehicles more in line with their requirements these days.

[Doggie 1]

If the Aussie dollar falls back down to .70, ?

But is that likely?

Where are you Dave? (db08)

Depends who you listen to.
For every economist who says it won't happen you could probably find one who says that it will.
I hope that clears it up for you. 
Personally, I can't see it. I'm waiting for it to find its bottom so I can ride it up but bottom-picking is an extremely difficult thing to do.

[Dazzler]

but bottom-picking is an extremely difficult thing to do.

Yes, you could put you shoulder out...

[2i30s]